Unwind Rentals at Retirement via IRA
We are approaching allowable IRA distribution age and have multiple rental properties all with taxable cap gains and no mortgages
We have taken a second rental as primary residence now but why sell at this point in time at such depressed prices, so we will wait.
Our question involves transferring some of our rentals to our self-managed IRAs and then using the tax-deferred nature of it to lower the tax implications.
The mechanism would be, sell the property to our IRA's at the adjusted base, so no tax bill, unwind the property from the IRA, again no immediate tax bill, and then take our distributions form the IRA's and pay tax on that, which would be almost nothing due to our lower incomes at that point.
Again, doing this at this point in the real estate valuation may not be the best, but once values begin to climb again
Was just wondering if anyone has used this mechanism for unwinds, I believe it is perfectly legal, but will check with tax people.
Cheers